A bond has a coupon rate of 10.2 percent and 3 years until maturity. If the yiel

Question

A bond has a coupon rate of 10.2 percent and 3 years until maturity. If the yield to maturity is 10.4 percent, what is the price of the bond? (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.)

(ANSWER IS NOT 99.48)

$   

A bond has a coupon rate of 10.2 percent and 3 years until maturity. If the yield to maturity is 10.4 percent, what is the price of the bond? (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.)

Explanation / Answer

Price of the bond                      995.06 Statemnet showing Price or Intrinsic Value Particulars Time PVf @10.4% Amount PV Cash Flows (Interest) = 1,000*10.2%                          1.00                   0.9058       102.00                 92.39 Cash Flows (Interest)                          2.00                   0.8205       102.00                 83.69 Cash Flows (Interest)                          3.00                   0.7432       102.00                 75.80 Cash flows (Maturity Amount)                          3.00                   0.7432    1,000.00               743.18 Intrinsic Value of Bond or Current Bond Price               995.06

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.